Standing Committee E

[Mr. Derek Conway in the Chair]

Housing Bill

Clause 120 - Meaning of ''residential property'' and

Edward Davey: I beg to move amendment No. 334, in
clause 120, page 84, line 15, leave out 
 'or intended to be occupied.'.

Derek Conway: With this it will be convenient to discuss the following amendments:
 No. 335, in 
clause 120, page 84, line 16, leave out 
 '(and includes one that is being or is to be constructed)'.
 No. 313, in 
clause 133, page 90, line 3, at end insert— 
 '(5A) But in the case of a new home sold by the builder to a first buyer with the benefit of ten year warranty issued by a warranty provider the requirements under subsection (5)(d) and (e) shall not apply. 
 (5B) In the case of a new home sold within 10 years of the issue of a warranty applying to it issued by a warranty provider (other than in the circumstances described in the preceding subsection) the information required under subsection 5(d) and (e) may be provided by the warranty provider so long as— 
 (a) the individual providing the information meets the requirements of section 134(3), and 
 (b) the warranty provider has a scheme which meets the requirements of sections 134(3), (4), (5) and (6). 
 (5C) In this section ''warranty provider'' means the National House Builders Council or other warranty company certified by the appropriate national authority for issuing a warranty in respect of new homes.'.
 No. 420, in 
clause 134, page 91, line 16, at end insert— 
 '(8) A responsible person will be exempt from the requirement to provide a Home Condition report in the following circumstances— 
 (a) the sale of a new home provided that it is registered with a warranty provider designated by the Secretary of State, 
 (b) the resale of a new home where the warranty cover remains in force, 
 (c) the transfer of ownership by a developer of a new home to another company prior to marketing the property to the public where the company assuming ownership is registered with a warranty provider designated by the Secretary of State.'.

Edward Davey: It is nice to start part 5, because there has been consensus up until this point and now we can have the proverbial bun-fight. As you will know, Mr. Conway, the Liberal Democrats and the Conservatives have a problem with home information packs.
 Amendment No. 334 is a probing amendment. We are trying to elicit from the Government, information as to the types of property that would require a home 
 information pack. We want to ensure that full consideration is given to which properties will, or will not, be subject to the requirements of part 5. Sellers of unoccupied properties, such as derelict ones, could be required to provide a home information pack. This amendment would exempt unoccupied properties from the requirement to have one. Under the amendment derelict property would be excluded, but new homes that are specifically included elsewhere in the clause would not. That is sensible. It is absurd that a derelict or run-down property should have a home information pack, even if one were happy to agree to the absurdity of home information packs in the first place. 
 Derelict and run-down properties are sold for refurbishment. People know that such properties are in a bit of a mess; they do not need a home information pack to tell them that. Likewise, I do not think that a directive on energy efficiency would apply.

David Kidney: The scheme is about offering properties for sale for people to buy. If someone is going to buy a house that has stood empty for a long time, is it not relevant that they should know from the local searches whether the local authority has a plan to demolish or compulsorily purchase it? If the property is brand new, is it not relevant to find out whether there is a guarantee for the first 10 years of its life? Why does the hon. Gentleman say that it is ludicrous to require that information, which is so relevant to the buyer, to be supplied?

Edward Davey: We are talking primarily about developers, who will redevelop a derelict property. The idea that such people would need a home condition report on a derelict property seems ludicrous. There is no problem with exempting that type of property. We are trying to be helpful to the Government. The Minister and I will have a couple of boisterous discussions in the next two or three sittings. I do not think that the Government want to place the requirements of legislation like this on such properties.

Brian Iddon: One of my relatives attempted to purchase a property that was being refurbished, but the people who were refurbishing it could not afford to complete the job. It was semi-derelict. He incurred all the costs of solicitors and so on, and then discovered that the garage was standing on land for which no lease was available. That was only discovered late in the process, when he had spent a terrible amount of money. Is it not right that people who are buying properties—derelict or otherwise—should know whether a proper agreement is established?

Edward Davey: In that case, what we shall be arguing later on would apply—caveat emptor is relevant. Most of the properties that we are talking about in relation to amendment No. 334 are not properties of the type that the Government originally had in mind as a populist measure in their 1997 manifesto.
 Amendment No. 335 deals with new homes. Why should they be included? This is a probing amendment to help us to understand the Government's thinking on the issue. Presumably, new homes come with 
 guarantees. They are also covered by other regulations of the building industry, and will have to be inspected by building inspectors. New homes will have to be signed off, and the builder will have to give a 10-year guarantee.

David Kidney: Surely the point of the scheme is that people get all the relevant information at the beginning? Part of that information is whether there is a guarantee. I cannot understand why, if the hon. Gentleman thinks that the guarantee should be provided to the buyers, he would want to scrap the scheme. That, effectively, is what he would do by excluding some properties.

Edward Davey: Let me explain: I am against the whole of part 5. [Hon. Members: ''Oh!''] I do not pretend otherwise; I would like part 5 to be removed. I am only surprised that those on the Government Benches are surprised about that. They clearly were not paying attention on Second Reading. If we could have tabled a nice, simple amendment to delete part 5 and there had been agreement on it, we would have saved an awful lot of time. What we are trying to do, through a number of amendments, is to make part 5 slightly more sensible. It has not started off as being terribly sensible, and we reject the entirety of the thinking behind it, but if we are forced to have such unnecessary, heavy-handed regulation, with all its disastrous consequences, let us try to make it slightly less damaging. That is the purpose of amendments Nos. 334 and 335. They would exclude certain properties that we think do not need to have a home information pack.

John Hayes: It is a delight to be here once again, debating important issues, as we move on to part 5, which is perhaps in some ways—hon. Members may agree—the most contentious part of the Bill. I do not mean to suggest that the earlier and later parts are not just as significant; but this is probably the part of the Bill that the public will look to with the most concern. As the hon. Gentleman suggested, we too have profound concerns about this part of the Bill. It is frightening that in that respect we may agree with the Liberal Democrats on a number of occasions in the coming hours and days—it frightens me, anyway.
 The Liberal amendments in the group do have a point. The hon. Gentleman is on slightly dicey ground when he talks about the Minister and Labour Back Benchers not paying attention, given his and his colleagues' variable attendance record. People in glasshouses should not throw stones. I notice that the Liberal Democrat Committee members are all here together; I had begun to believe that they were a single person with a series of cunning disguises—or that, like the royal family, they did not like to travel together. However, they are here, so it is important that we look at their amendments. 
 The Liberal amendments make an important point about exceptions, but there is a real problem with exceptions: they will confuse lenders. Certainly, the Council of Mortgage Lenders is anxious that, in the clause and in this part of the Bill, we do not end up 
 with a multiplicity of arrangements, so that people really do not know on which properties they need to get reports, and on which they do not. There is an advantage in clarity and simplicity. Although I have some sympathy with the hon. Gentleman's argument about extreme cases—derelict properties may fall into that category—I am slightly more persuaded by the intervention of the hon. Member for Stafford (Mr. Kidney). The cases on the margin, of which there will be many, would cause confusion and a lack of clarity. That would certainly be disadvantageous to lenders and possibly to others. 
 I come to the amendments in the group that stand in my name and those of my hon. Friends. We are concerned at a more fundamental level about the new properties that will be drawn into this net. Our amendment No.420 is not proposed in respect of derelict properties but for those properties where there is already a reasonable level of protection for all concerned with the transaction. 
 I can see the point made by the hon. Member for Stafford about properties for which there is no protection and very little information. As he suggests, it may be highly desirable in those circumstances to glean more information. However, to suggest that a range of measures should be inserted that will overlap with—and may not have as much force as—a warranty that is in place, seems to be close to duplication. This point has been made to me by a number of people associated with the industry, particularly the House Builders Federation, which argues for this strongly. The Minister will have had representations from the federation, which says: 
''Such warranties provide a good and fully sufficient protection for purchasers, including the ability to secure remedial action in the event of a problem with the home''.
 Given that such warranties and therefore such homes must be compliant with a range of well established and well understood national criteria, there is an argument against applying the provisions proposed in the Bill to this type of property. I know that the Minister will have considered that, because the argument did not begin today—the case that I have made has been put on a number of occasions. 
 The warranties issue also needs to be examined in terms of the protection that is likely to be given by the new packs. There is a question about how they will be indemnified and how much security they will offer. Ironically, the warranties might offer more security, and it would be a curious situation where we replaced—or at least duplicated—an existing provision that was providing a higher level of protection for those purchasing homes. 
 Therefore, in consumer terms, there is little argument against amendment No. 420. In administrative terms, there is a good argument for it. The cost and bureaucracy associated with doing a job twice are undesirable. Later in the course of the Committee we will talk about the difficulties of recruiting sufficient people to implement part 5. Of course, it will help in that respect as well, because it will exempt those new properties that are covered by warranty and the properties that are resold from one builder to another from the requirement for a home 
 condition report—I saw the hon. Member for Bolton, South-East (Dr. Iddon) looking sceptical during my peroration and I see that he wants to intervene, so I am happy to give way.

Brian Iddon: Particularly in urban areas—on brownfield sites—there can be problems with land ownership. When I bought my new house, which I currently live in, the builder—who is a well known national builder—was unable to tell me whether he had purchased the whole of the land. It was in five ownerships. Halfway through the process, I was told that the house would be sold leasehold, but finally, when the contract came, it was freehold. Does the hon. Gentleman not think that builders who build on brownfield sites should establish the ownership of the land prior to the sale?

John Hayes: Yes, that is a good point. Builders should be absolutely clear about the ownership of the site prior to the sale. The hon. Gentleman will know that there are a range of legal requirements and guidance at local and national level that assist in that process. As the hon. Gentleman suggested, it is entirely undesirable that there should be a lack of clarity about the original ownership of the site at the point at which a consumer or a purchaser becomes involved in the chain. However, he would acknowledge that while that case is not unique, it is unusual. He is suggesting that it may become more typical as we have moved towards building on more difficult sites. The brownfield sites that remain will increasingly be those that are hard to develop, because of contamination due to previous industrial use and so on.
 The hon. Gentleman has a fair point, but the force of the argument is still weighted heavily towards the amendment. Such exceptions should be dealt with, but they will be better dealt with if the legislation is targeted and focused than if there is a broad-brush approach as a result of which all new homes are affected by the provisions despite the fact that a high proportion of them do not suffer from problems of the type that he has described. The hon. Gentleman makes a good point but I do not think that it is sufficiently powerful, although clearly he thinks that it is and he is about to tell me why.

Brian Iddon: This is a very quick intervention: 70 per cent. of Bolton's current new homes are being built on brownfield sites. That is above the Government requirement, which is very high.

John Hayes: The hon. Gentleman has given a quick advert for the Minister, which I am pleased about. He has reminded the Committee that the Minister has achieved 70 per cent. The Minister has failed the House, the Government and the country in many ways, but in this way he has not. He has set a target and he has bettered it; he has achieved 70 per cent., rather than the 60 per cent. target.
 Despite that, it must be said that not all brownfield sites are difficult sites. The vast majority have neither the profound difficulties of ownership that the hon. Member for Bolton, South-East has described nor profound difficulties of development. Some of them have those difficulties, but many do not. It would be unhelpful to broadcast the message that there is a 
 problem with extending brownfield development because of the issues that the hon. Gentleman has rightly highlighted, and I know that he would not wish to do so in this Committee or elsewhere. 
 The hon. Member for Kingston and Surbiton (Mr. Davey) is welling up because he wants to intervene, and I am delighted to accept his intervention.

Edward Davey: The hon. Gentleman has not answered the valid point made by the hon. Member for Bolton, South-East about certain types of brownfield development. The key question is whether we should use a sledgehammer to crack a nut. The vast majority of homes that are bought and sold every year are not on brownfield sites. Their legal status is well known through many transactions. We do not need all the heavy-handed regulation that is in part 5.

John Hayes: That is of course true, but it is a different point from that raised by the hon. Member for Bolton, South-East. The hon. Member for Kingston and Surbiton is rightly saying that the overwhelming majority of transactions in any year do not involve brownfield new build. That is a good argument against the provision as a whole. The specific point that the hon. Member for Bolton, South-East made applied to new buildings on brownfield sites of a difficult nature. He mentioned the issue of the ownership of the land. He could have mentioned the difficulty of conducting some of the searches that are required where there was a previous troubling industrial or other use that means that people might have worries about subsidence, toxicity and so on.
 The hon. Member for Bolton, South-East makes a good narrow point that could be dealt with by a focused legislative approach. The hon. Member for Kingston and Surbiton makes a broader point, which is that the issue raised by the hon. Member for Bolton, South-East not only involves a small minority of new build—and a small majority of brownfield new build—but involves an even tinier proportion of the total number of transactions that take place every year. 
 I defend the hon. Member for Bolton, South-East on the grounds that he has brought an important point to the Committee's notice. However, I do not think that it is a sufficiently strong point in terms of the total number of houses or of new houses bought and sold to negate my argument that not only will new houses built on brownfield sites or elsewhere be subject to all the building regulations, which provide a high level of protection, but there will also be a warranty that meets national standards, which already provides a higher level of protection for the consumer than the proposals in the Bill could provide. That is the reason why we tabled amendment No. 420. 
 Amendment No. 420 relates also to the resale of a new home while the warranty is in force. We are talking about people who buy a new house, builders that resell to another builder or developer in the early life of a new house, and the early resale of that house. The amendment would have a beneficial effect from the Government's point of view because it would make things easier to apply by removing the demand for 
 home information packs from a significant number of properties. The amendment would also reduce the bureaucratic burden and avoid duplication, which house builders and others feel would result from what the Government propose. 
Mr. Clive Betts (Sheffield, Attercliffe) (Lab) rose—

John Hayes: I will give way only briefly, as I am approaching the end of my remarks.

Clive Betts: Resale is slightly different from the original sale. A property that is resold five years after it was initially bought could well have changed in some way. For example, a conservatory or an extension could have been built on, which would not be subject to the warranty but would still need a survey to establish its state before it was sold on, and that would form part of the home information pack. The problem is that that is not covered in the amendment.

John Hayes: The hon. Gentleman is, as ever, incisive and attentive. I could have moved my amendment without mentioning the issue of resale, but I thought that I would do so to be fair to the Committee. He is absolutely right that there is a different argument about scale. A new extension or building attached to a house, if it is a substantial development or addition, will probably have received planning permission and been built in compliance with the building regulations, and the original house would still be covered by the warranty that was issued when it was first sold. The warranty is time-limited so, unless the individual has built something outside of regulations and without planning permission, and it is of poor quality, and then has sold their house on that basis, which would be outside existing law, the hon. Gentleman's point is less powerful than it seems.
 Existing regulations and standards will apply to someone who extended their house soon after purchasing and then sold it on, which affords protection both to them, in terms of ensuring that they got what they wanted from their builder, and to the person to whom they sold it on. The hon. Gentleman is right that there is a separate argument about resale. One could say that brand new houses fell into one category and houses resold within the first five or 10 years into another, but the weight of the case is still in favour of including everyone who is covered by the warranty. If we did not accept that argument, we would have to start making split arguments about the warranty, so that people with a warranty were required to have a pack in some cases but not in others. That would complicate the Bill unacceptably.

Clive Betts: There is a further problem. If the warranty is about to expire within one month of the sale going through, it is hardly worth anything. The hon. Gentleman is suggesting that the buyer should rely on the warranty, which is about to expire, yet no up-to-date survey will have been conducted, and that is not a good guarantee for the person who is buying.

John Hayes: That argument could, of course, be used for the home information pack. There will always be
 marginal cases. If a home condition report has been produced and it has a period of validity, it might well be that the house is sold the day before the home condition report expires. Any provision of this kind—warranty, guarantee or whatever—will always have a margin and at that margin it is possible for a transaction to take place. That is true of a guarantee or warranty for any item that one buys anywhere. When one buys a house, a car or any other major purchase, there will come a point when the guarantee or warrantee expires. So, although the hon. Gentleman always puts forward a compelling and attractive argument, in this case I am persuaded that my amendment would be a useful addition to the Bill. 
 The Liberal Democrat amendments are interesting and I am grateful to the hon. Member for Kingston and Surbiton for tabling them, even though, on balance, I am concerned about the multiplicity of arrangements that might flow from his proposals being accepted. On that basis, I urge my colleagues to listen to what the Minister says, but if he is not very persuasive, we may have to consider moving to that difficult stage in our proceedings at which the Committee divides.

David Kidney: My amendment No. 313, like the amendment tabled by the hon. Member for South Holland and The Deepings (Mr. Hayes), focuses on new homes. The way in which the debate has concentrated on new homes shows your good sense in grouping the amendments Mr. Conway.
 The hon. Member for Kingston and Surbiton aims, through the lead amendment, to exclude new homes from the requirements of the home information pack. If it were accepted and the rest of the Bill remained as it stands, an individual seller would be required on the sale of the house to produce evidence of the interest that is for sale, the title of the property, guarantees for the property and information from the registers of the local authority, whereas a national house builder selling thousands of properties a year would be exempt from those requirements. That strikes me as an odd approach to consumer protection. 
 My amendment would deal with the situation in the same way as the amendment tabled by the hon. Member for South Holland and The Deepings. It covers new properties that are sold by a builder with a guarantee that lasts for 10 years. The National House-Building Council is not the only provider of warranties for the first 10 years of a property's life, but it is by far the biggest in the market. We should remember that its guarantee means that there are two years of comprehensive cover for a fault with the property, and a total of 10 years of cover for structural problems. That is a good standard of protection. 
 Why require a surveyor to carry out a survey of a property on day one, when it has not been occupied by anyone and changes therefore cannot have been made? Given the usual standards of competence, we expect the builder to have built it properly, and there is a good system of protection for the buyer if anything 
 goes wrong. Why put the builder to the expense of paying for a surveyor, too? That is a good argument in respect of a brand new property for a first-time buyer. It is covered by the first part of the amendment tabled by the hon. Member for South Holland and The Deepings and by the first part of my amendment No. 313. 
 The Minister has a good get-out from my amendment, which is all my own work. He could easily say that it is technically deficient and promise to return with a decent amendment of his own. I would be satisfied with that. His consultation document about the contents of the home information pack has a chapter beginning on page 41 entitled ''Pack contents—New homes'', which sets out Government's intentions regarding a new home that is sold off-plan. If a person buys the property even before the builders have finished building it, to move in when it is completed, there would be no requirement for a home condition report.

John Hayes: The hon. Gentleman makes a good point about the consultation document. That is why I said to the Minister—albeit in slightly more subtle terms—that he would have thought hard about the matter and received representations about it. I am aware that there may have been a change in the Government's thinking during their deliberations about what must and must not go into the Bill.

David Kidney: Yes, and I agree with the hon. Gentleman that we should listen to the Minister's response to learn about the Government's thinking. The matter is stated strongly in the consultation document. If a property is complete and sold to a first-time buyer, the document asks whether we should exempt the builder or developer from producing a home condition report for the property. Under the first part of my amendment, the builder would not be exempt from providing the whole pack, but only from providing the home condition report and the energy efficiency assessment. That is consistent with the consultation document.
 As the hon. Gentleman said, we each received a letter from the Minister in which he enclosed his proposals about regulations to be made under part 5. I looked in vain for any comment about the exemption of first-time sales of new properties from the requirement to provide a home condition report. Does that omission mean a cooling off of the Minister's part, or was it simply an oversight and he will now tell us that that remains the Government's intention? 
 My hon. Friend the Member for Sheffield, Attercliffe (Mr. Betts) quizzed the hon. Member for South Holland and The Deepings by about resale within 10 years, in respect of which my proposal—which I freely admit is drawn from a suggestion made by the industry—is slightly different from his. The person selling a house that is less than 10 years old to a second buyer should have the option of choosing who makes the home condition report. It could be an outside inspector authorised under the legislation; or the warranty provider's inspector—also authorised under the legislation, with the proper insurance and so 
 on—could be engaged to carry out the inspection and make the report. 
 The benefits to the provider of the warranty, and therefore its interest in providing such a service, are that it would have opportunities to provide additional consumer education by explaining that the warranty still exists and the extent of the cover, as well as to refresh the covenants in the warranty—to say, ''We can extend this, if you want us to, at a very reasonable price.'' Most important, it gives the provider a much better handle on the risk to be managed during the 10 years covered by the guarantees that it has given. That is, apparently, a very valuable asset for providers.

Sydney Chapman: The hon. Gentleman is on to an extraordinarily good point. He mentions the National House-Building Council in his amendment. It is not some sort of esoteric organisation; it has been in existence for some 65 years—less than I have, but for quite a long time none the less. The NHBC inspects 85 per cent. of new homes coming on to the market—it undertakes 750,000 inspections per year. It is a well established, non-profit-making organisation. It provides the guarantee—or warranty, as I prefer to call it—in the first place. If we are going to tackle unnecessary bureaucracy, surely it makes common sense that the warranty provider should have the right to re-inspect a building that is to be sold one year before the expiry of a ten-year warranty, and to examine conservatories and any other additions to the property. It makes sense that we extend the warranty provisions in that way.

David Kidney: I thank the hon. Gentleman for what sounded like a supporting speech.

Sydney Chapman: It was intended to be.

David Kidney: I entirely agree with what he said. The NHBC carries out an awful lot of building regulation inspections in place of local authority inspectors, it has the history, and it certainly has the capacity and expertise to provide the service that I suggest. I am not saying that it should replace external independent inspectors, but merely that the seller should have the option of choosing who is to carry out the inspection.
 Because I support part 5 as a whole in relation to consumer protection, I will discuss the benefits for the consumer of accepting my proposal. First, because there would be competition in providing surveys and reports, prices would be keener. Secondly, there would be the possibility of warranty cover being improved, providing a benefit in terms of guarantees on the property being extended beyond 10 years, or extended to cover more things than it originally covered. People who have the benefit of the warranties would have better information: when I met with NHBC representatives, they told me—very wearily—of the number of times that they passed a brand new certificate to solicitors or other buyers' representatives who put it away somewhere and the buyer never knew that they had the cover. That is a pretty sad state of affairs. My proposal would clearly make the warranty much more important and something that people would be more aware of. 
 The suggestion made by the hon. Member for South Holland and The Deepings that a property resold within 10 years should simply be exempted from the requirement is quite a neat development, but I agree with my hon. Friend the Member for Sheffield, Attercliffe that a lot can happen within that 10 years. There should be a report, and the purpose of my amendment is to ask who should provide it.

John Hayes: My hon. Friend the Member for Chipping Barnet (Sir Sydney Chapman) was right—the hon. Gentleman is on to a good point. It may even be that the amendment tabled by the hon. Member for Stafford is, as he suggests, although he did not use these precise words, a more sophisticated version of mine. My sole doubt arises from the fact that, under his system, there would be a greater variety of arrangements, and therefore more complexity, than under mine. Some people would choose one route and others would choose another. People at different stages of ownership would have different rights. Furthermore, lenders have repeatedly asked for clarity in the measures, so I wonder how they would feel about the system he proposes. In terms of guaranteeing standards, I wonder whether it would not create an extra administrative burden.

David Kidney: I would not like to be called sophisticated, so I again acknowledge the help that the NHBC gave me in developing my proposal; it is not all my own work. The wording of the amendment, however, is all my own work, and that is what may need some refining.
 On the question of complexity, I echo the point made by my hon. Friend the Member for Sheffield, Attercliffe about NHBC inspectors who carry out building regulation inspections. That arrangement developed under the Conservative Government, I think, and it is now a well established part of the market. One might say that it would be more complex to allow either the local government inspector or the NHBC inspector to carry out the inspection, but the market has coped so far, so I have no worries on that point. As for whether consumers and lenders need have any concerns, I repeat that the inspectors would still have to have the qualifications, certification and insurance cover that any other home inspector would need to have. There is no suggestion of letting the NHBC off compared with the standards that everyone else would have to meet. 
 I think that I have explained my point well. I have explained to my right hon. Friend the Minister how he can get out of accepting my amendment today, but I hope that he will give the industry some comfort about his future intentions.

Robert Syms: I can see that, although there may be differences between hon. Members on both sides of the Room on the principle of home information packs, there is probably consensus on the narrow point we are arguing about in relation to amendments Nos. 313 and 420. I hope
 that that consensus might even include the Minister by the end of the debate.
 It is clear that, initially, the Government were going to allow the certificate on new-build houses to be used instead of a home condition report. Like the hon. Member for Stafford, I am concerned that that was not mentioned in the letter. We would like the Minister at least to make it clear today whether it remains the Government's intention that the NHBC certificate can be used for the first sale and in the resale. Of course, much of what needs to be done through the Bill could be done by regulation, but we are anxious to get the Government's intentions on those points clearly on the record. 
 My hon. Friend the Member for Chipping Barnet is absolutely right—the NHBC is a substantial organisation. It has been going for 70 years, I think, and it has £1 billion in reserves, as well as a lot of dedicated surveyors. It provides a good service and, as the hon. Member for Stafford said, it does a lot of building regulation work for local authorities. It would be quite sensible if the NHBC and the other two organisations in the industry that provide that sort of insurance could be used to supplement and perhaps enhance what the Government want to do. We are talking about a 10-year guarantee on property, after all. 
 To pick up on the point made by the hon. Member for Sheffield, Attercliffe, if the regulations were framed so that those organisations had the opportunity to re-inspect properties and to extend the warranty if necessary, those with new-build houses or fairly young properties would get an enhanced service—much better than that given to those with a home condition report. That would be much better for the consumer. The logic of the amendments, however inelegantly worded they are, is that they would ensure that those in new-build housing got better service and coverage to than the Government's proposals would provide. That would be sensible. 
 The hon. Member for Stafford made a good point about competition between surveyors. One of the key points in the debate about home condition reports is that there will be a real problem with surveyors. The Royal Institution of Chartered Surveyors says that up to 10,000 may be needed, so several thousand need to be trained, whereas the Government assume that 7,500 to 8,000 are needed. Organisations such as the NHBC already have dedicated surveyors. If those experienced individuals could take on that part of the new-build market, it would help deal with one of the major problems of implementing this legislation by 2006 or 2007. That is an important point. 
 There is much to commend the amendments tabled by the hon. Member for Stafford and my hon. Friend the Member for South Holland and The Deepings. We want the Minister to put on the record today what the Government intend to do through regulations. In addition, we hope that they are at least open-minded about considering, as the Bill proceeds to another place and Report, amending this provision to give an enhanced service to those who are buying new or nearly new properties. That might mean that the Government's objectives, which they have set out 
 clearly in lots of glossy documents, would have a much better chance of being met than if our proposals were turned down and we returned to a narrow focus on the home condition report. 
 There is a lot to commend the amendments. I hope that the Government are in listening mode, because there are benefits for the Great British public and consumers.

Clive Betts: First, I shall pick up where the hon. Gentleman finished on staffing issues, because that is a good point. The proposal made by my hon. Friend the Member for Stafford on the sales of brand new properties is spot on. He suggests that the survey done for warranty purposes should stand as a survey done for the home condition report, thereby saving staff input into the process. If we exempted all first-time sales of new properties at the outset of the home information pack system, when we will be struggling to carry out all the additional surveys, that would be an asset to getting the new system up and running.
 My hon. Friend made an important point. His amendment deals only with home condition reports, not with an exemption from home information pack. He suggests that that element be taken out for the first-time sales, which is a valuable addition. If there is no need for an additional survey for first-time sales of brand-new properties, the process will get running more quickly. I am sure that the Minister will want to take that idea on board, because it has considerable merit. 
 If there is any suggestion at all that the current survey for warranty purposes does not meet the standards the Minister is seeking in the home condition report, that could be discussed with the providers of the warranties—the NHBC and others. I am sure that small adjustments could be made to the way in which they carry out their surveys as part of the warranty process and that those could be brought up to the standard that the Minister requires for home condition reports. My hon. Friend is right to propose new subsection (5A), and even if the wording is not as precise as it needs to be, I am sure that the Minister will reflect on it. 
 There is a much more difficult and in some ways more interesting issue around the resale of houses during the warranty period. I return to what I said a few minutes ago to the hon. Member for South Holland and The Deepings. People cannot withdraw from the new survey process once a house is resold, because changes could have been made to the property in the meantime—an extension or addition, or something has happened structurally which requires another survey—or the warranty period could be so close to ending that it is virtually meaningless. There is no point saying, ''There was a survey nine and a half years ago''. That is not much comfort to someone who is investing a considerable sum in buying a property. A further survey is necessary in such cases. 
 My hon. Friend the Member for Stafford suggests in proposed subsection (5B) that the initial warranty provider should do the second survey. That has great attractions, so I shall tease out whether it might go even further. It would seem greatly advantageous that 
 the second survey on the point of resale be done by the original surveyor who provided the warranty. That would be a lot simpler for the purchaser, because if anything went wrong subsequently they would have one point for redress. The purchaser could go back to the organisation that carried out the original warranty survey—NHBC or some other body—and redress could be found with that same organisation. That is an enormous advantage for the purchaser. In addition, the warranty provider might want to consider an extension to a warranty, which could be an additional new service and an arrangement that benefited the purchaser. As my hon. Friend suggested, I know that the NHBC has suggested that it might want to be involved in extending warranties if it is the one conducting the survey on resale. 
 I want to tease out from the Minister whether he has had legal advice on the following point: if the amendment tabled by my hon. Friend were accepted, the vendor could decide that he did not want to go back to the warranty provider for a survey on resale, but wanted to go to another organisation. That it is a cause of slight concern. If the initial warranty is in place but another survey has been done and something then goes wrong with the property—a structural fault of some kind develops—where do the purchasers of the property, which is now their home, go? Do they go to the initial warranty provider, or to the organisation that has done the survey on resale? Would there be any conflict about where to find redress? Could one of the organisations—the NHBC if it had done the initial warranty—say, ''Hold on a minute, it is not for you to challenge us on the warranty. You have had a survey done since then, and that supersedes the initial warranty, so you ought to go to the organisation that did the survey on resale.''? 
 That is a legal problem to which I do not know the answer. Could the person who has purchased the property on the second sale be caught in a dilemma about where they can claim redress? I wonder whether included in the 10-year warranty and the home information pack should be a requirement, rather than an option, to go back to the same warranty provider for the survey. My hon. Friend uses the word ''may'' in his amendment, but I wonder whether it ought to be ''should.'' I know that there are competition issues related to that—we would be handing a monopoly to the initial warranty provider to provide the survey on resale—but provided that an arrangement could be reached about a fixed priced for surveys, that could simplify the whole process in legal terms. The Minister might want to look into that. 
 My right hon. Friend might be able to reassure me that there is no legal problem, and say that it is acceptable for a new purchaser to rely on the initial warranty and a survey provided by someone completely different. However, if there is a problem, I am sure that he will want to think about it and find a way forward.

Keith Hill: Let me begin by assuring the Committee that we intend to approach this matter—including the principle to which we are clearly committed—with as much open-mindedness as possible. There is a great
 willingness on our part to engage constructively with the industry—after all, it is the industry that will have to deliver on the proposals for home information packs. I am delighted to say that already there is a high level of engagement on the part of all elements of the industry in considering the implementation of the proposals. I hope to demonstrate that as we continue our proceedings.
 I am grateful for the constructive spirit in which amendments have been tabled. My hon. Friend the Member for Stafford has become, to all intents and purpose, my guru in these matters. I also appreciate the spirit in which Opposition Members have spoken to their amendments, and the helpful way in which the hon. Member for Kingston and Surbiton raised issues—notwithstanding his root-and-branch ideological objection to our proposals. 
 We have had a very particular debate on this first set of amendments, which is natural and proper. However, with your permission, Mr. Conway, and that of the Committee, I want to move from the particular to general issues before I address the amendments by offering my overview of this part of the legislation. We have got into the habit of doing that in this Committee, and on the whole it has been found to be helpful. Therefore, I hope that I will be allowed to offer—I am unsure whether I dare use this phrase—a tour d'horizon by explaining the broader purposes of and justifications for part 5, which provides for the introduction of home information packs into the process of buying and selling homes in England and Wales. 
 I have no doubt that Committee members have had their own experiences of home buying and selling and will have heard horror stories from their constituents. Nevertheless, I hope that I may be forgiven for spending just a few moments outlining the main problems. The present home buying and selling process is deeply flawed: it is painfully slow by international standards, it is inefficient and wasteful, there is a high rate of failed transactions, it does not operate in the best interests of consumers, it causes buyers and sellers considerable frustration and stress, and there is wasted expenditure.

Edward Davey: Will the Minister give way?

Keith Hill: Allow me to develop my broader thoughts on this matter in my own characteristically open-minded fashion. I suspect that the Committee may want to revert to a general discussion about the purposes of the clause.

Edward Davey: May I make a tiny intervention?

Keith Hill: The hon. Gentleman wants to make a tiny intervention. If I give way to him, every Committee member will want me to give way so that they can make a tiny intervention. However, I will make an exception for the hon. Gentleman.

Edward Davey: The Minister is most generous. I do not necessarily agree with what he has said so far, but I just wanted to add to his list of descriptions of the
 home selling process in the UK. Does he agree that it is also the cheapest such process in the world?

Keith Hill: The hon. Gentleman has made that assertion in the past, but I have not seen the evidence to support it. In any case, our proposals will enhance the efficiency and cost-effectiveness of the process, and in all circumstances there will be significant savings as a result of that increased efficiency.
 I return to the broader issues. Consumers are fed up with the system. Research by Yorkshire bank found that nine out of 10 people are unhappy with it; there is a 90 per cent dissatisfaction rating. Over the past five or six years, my Department has commissioned extensive research in this area and backed that up with wide-ranging consultation. Our starting point was the most extensive study ever carried out into the home buying and selling process. That involved tracking 800 transactions through the process in a range of areas and markets. The study showed that the key problem in all areas and markets is that important information that buyers and sellers need in order to make decisions is not available at the start of the process. 
 Let us be clear about the purposes of our proposals for home information packs. They are about the consumer; they aim to afford greater up-front certainty, to increase consumer satisfaction and to secure fewer failed transactions. 
 In many cases, that information, which is so necessary to the buyer, does not become available until after terms have been negotiated and agreed. Buyers make offers and then negotiate ''blind.'' They learn about problems with the property only later in the transaction process, often weeks or even months after terms have been agreed. When problems are revealed, buyers then want to renegotiate or pull out completely. That causes buyers and sellers considerable uncertainty, stress and wasted costs. There is a knock-on effect throughout the chain. In our discussions, we must always remember that the focus is on the consumer's interests and the effects of this process on the chain. Nearly 30 per cent. of transactions fall through after terms have been agreed, and the price of failure is high—on average about £1,000 a transaction for consumers alone. That does not count wasted costs incurred by estate agents and others in the industry.

John Hayes: I wonder whether the Minister will elucidate what proportion of those failed transactions involved new homes. His argument about people changing their mind once they have received information is bound to apply, to a much greater degree, to homes that are not new and where there are more complex circumstances—some of them were referred to in an earlier intervention. The argument is not forceful unless it can be suggested that in respect of the amendment there is also a major problem with new homes.

Keith Hill: The hon. Gentleman draws us back correctly to the purpose of the amendments, which I am about to deal with. Perhaps, with his permission, I can deal with the issue of new homes in what, I hope, is a helpful fashion when I discuss the amendments.
 The Bill addresses the issue of failed transactions head-on. It requires sellers and their agents to assemble key information before the property is marketed, and to make that information available to potential buyers. That will bring much-needed transparency into the process. It will enable any problems with the property—for example, with title or planning consent—to be identified and addressed early on, before they put the sale at risk. It will help the seller and the estate agent to decide on a realistic price, which reflects the true condition of the property. It will give prospective buyers the information needed to make a well informed offer and to proceed quickly once terms have been agreed. It will greatly reduce the risk of transaction failure or of terms' having to be renegotiated. It will shorten the period of uncertainty between offer acceptance and the exchange of contracts, thereby reducing the window of opportunity for gazumping and other problems. 
 However, as the Committee will be aware, part 5 is essentially enabling legislation. It sets out the home information pack duties and the arrangements for enforcing them. I look forward to debating those matters in detail as we discuss the part clause by clause. 
 Part 5 provides an indication—in clause 133—of the information that will be included in the home information pack, but the final detail is left to be prescribed in regulations. It is important for both consumers and the industry that we get this information right. I want to assure the Committee that we have no intention of introducing the home information pack requirements until we are satisfied that we have achieved that. For example, we will not introduce the home condition report until we are satisfied that adequate numbers of appropriately qualified and insured home inspectors are available. 
 All the main industry stakeholders and consumer representatives are working with us on this, and we have already made significant progress. To assist our discussions, I have made available to the Committee four sets of documents, the first of which is the consultation paper of the Office of the Deputy Prime Minister on the contents of the home information pack together with a report on responses to that consultation that was published earlier this week. The Committee will note that the responses reveal a high level of agreement with our proposed contents. We shall now start refining the pack's contents in close consultation with the industry and consumer stakeholders. 
 I refer secondly to the ODPM consultation on options for applying packs to low-value homes in areas of low demand, together with a report on responses that was again published earlier this week. I say in all candour that the issue is tricky. On one hand, we do not want to add to the problems of marketing the homes; on the other, we do not want to add to the stigmatisation suffered by the areas nor deny them the benefits of home information packs. 
 Part 5 of the Bill, specifically clause 133(9)(c), provides for different provision to be made for different areas and types of property. I look forward to gauging the Committee's views about that. I say 
 genuinely that I look forward to the input of members of the Committee and will be grateful to receive it.

Chris Mole: Will my right hon. Friend give us his views on the impact of the introduction of home information packs on that element of the market that is managed by the individual who makes his own arrangements rather than employing an estate agent?

Keith Hill: My hon. Friend raises an important issue, and one that we need to be clear about because it has been the source of some uncertainty. If he will forgive me, I shall deal with the matter when it arises naturally, which it will probably do in later clauses. I am keen to ensure that we are all absolutely clear about definitions.
 Thirdly, I have provided the Committee with a report by the Building Research Establishment on technical and consumer pilots of the home condition report, which reveals a high level of consumer satisfaction. It also provides several helpful suggestions for improvements, which we shall be considering further with the industry and consumer stakeholders. Fourthly, I refer to a report on an investigation by the former Property Services National Training Organisation of the likely labour pool for home inspectors. That also is reassuring. I hope that the documents and the considerable research that has been carried out by—I emphasise—independent consultants, and steered with the help of the industry and consumer stakeholders, will satisfy the Committee that we are adopting a considered and inclusive approach with the reforms.

David Kidney: I do not wish to seem impatient, but another document is the consultation paper that states:
''While a home is being marketed 'off-plan' . . . a home condition report . . . and energy efficient assessment . . . should not be required.''
 Is that still the Government's position?

Keith Hill: That is the Government's position and I intend to deal with that matter—almost immediately. If my hon. Friend will be patient for no more than 10 seconds, I shall complete my peroration on my tour d'horizon. I say in all humility that we recognise that much still needs to be done to finalise the detail, but we are satisfied that that can be achieved and that the home information pack can be introduced smoothly and successfully from the beginning of 2007. That is quite an important announcement and it is a commitment that the industry will be interested to receive. Let me conclude my introductory passage by saying that the reform is, of course, long overdue. I look forward to further debates on the matter.

Richard Younger-Ross: The Minister referred to the testing of reports of that kind that have been done. An estate agent in my constituency already produces the reports voluntarily. He says that they are satisfactory, and he is pleased with them. I accept that when people volunteer for the reports, they are successful; but the Minister, in his peroration, was talking about moving to a point where everyone has to have them done. If there is a negative
 market, and there is negative equity and falling prices, people have difficulty paying their mortgage. How can they then afford to pay for a report to be done, so that they can sell their house?

Keith Hill: I am certain that we will come back to the issue, but the reality is that if people, irrespective of their personal financial condition, want to sell a house, they will incur costs in the process anyway. It is perfectly clear that the cost of the home condition report—and that is the only new cost involved in the Government proposals; the seller already needs to spend money on all the other elements in the home information pack—is a relatively small part of the overall costs that are likely to be incurred. To that extent, we contend that the cost will not be a major additional burden on the seller. However, I am sure that there will be the opportunity to revert to these issues in due course.
 We also argue that there will be clear benefits for the seller in those difficult personal circumstances as a result of the home information pack, in that the pack would speed up the process of the sale, and it would remove possible impediments to the sale. Also, the pack would enable seller and purchaser to identify a realistic price for the property. 
 So, yes, there will be a small additional burden for the seller; but that is likely to be equalised because, as a purchaser himself—that is normally the situation—the seller would not require himself to spend money on a survey. To that extent, the cost of the process is equalised. On the whole, although one obviously understands and sympathises with the sort of predicament that the hon. Gentleman describes, I think that the pack will not be found to be an undue burden; indeed, it is likely to confer large benefits. 
 Let me attempt to deal with the amendments. I begin by expressing my thanks to my hon. Friends for their highly constructive input on our discussions, and for the considerable expertise that they displayed. The Government intend the marketing of single dwellings for sale with vacant possession to be subject to the home information pack obligations. The definition of ''dwelling-house'' in clause 120(1) is key to securing that. I contend that making the deletions suggested in the amendments would run counter to that objective. 
 Amendments Nos. 334 and 335 are in the name of the hon. Member for Kingston and Surbiton. I appreciate the helpful spirit in which he moved the amendment, notwithstanding that he has profound objections to the Bill. He asked about the types of property that would be affected. Will home information packs be needed for derelict or run-down properties? I thought that my hon. Friend the Member for Bolton, South-East dealt with that effectively when he pointed out that many of the elements of the home information pack will be necessary for such properties—for example, those relating to the local authority search or the water and drainage search will have to be engaged in under any circumstances. 
 With regard to derelict properties, I say to the hon. Member for Kingston and Surbiton that we are open-minded. We recognise that there is an issue that must be considered, and we will do so. Under clause 132, problems can be excluded from home information packs by regulations, if that is necessary. We do not have a closed mind on the issue. We recognise that certain searches will have to be undertaken. The hon. Gentleman raises a fair point in that specific respect, and we will examine the matter.

Edward Davey: I am grateful for the Minister's reassurance on that. He is in listening mode, and it is helpful to know that he will consider those points. However, I have difficulty with being asked to pass legislation without being quite sure what the Government are going to do. We have been consulting on this matter for a while. Can the Minister say whether he will get back to us about it on Report, or will we have to wait for regulations after we have passed the primary legislation?

Keith Hill: I do not want to sound as though I am being impatient with the hon. Gentleman, but the issue he has highlighted is a specific one, and one that, frankly, is of limited range. That often happens in Committee. However, the central purposes of the Bill include consumer protection and the securing of up-front certainty in the house purchasing process. Set against that, I do not think that it is a major dereliction of the Government's duty if we do not have a ready answer about derelict properties. This is an interesting, but not a massive, issue that we are willing to take a look at. The hon. Gentleman should contain himself: that would allow me to get on to the real thrust of what we are discussing, which is new properties.
 I turn again to the effect of the hon. Gentleman's amendments to clause 120. Amendment No. 134 would delete the words 
''or intended to be occupied''
 from the home information pack obligations for the marketing of homes that at the time of marketing are unoccupied. That is unacceptable. There are a number of reasons why a property might be unoccupied while it is being marketed, of which the hon. Gentleman has identified only one marginal case. The more obvious examples include when the owner has already moved, and when someone is selling the home of a deceased relative. The benefits of up-front information in the home information pack apply just as much during marketing to that type of home—which is by far the most normal type of vacant property—as they do to a home that is occupied. 
 The effects of leaving out the words 
''and includes one that is being or is to be constructed''
 would also be undesirable. It is common practice for house builders to market new homes before construction is completed. Indeed, homes are commonly marketed off plan before a single brick has been laid. Buyers of those homes need up-front information of the sort that the home information pack will provide just as much as do buyers of existing homes. That is already recognised by house builders, most of whom provide prospective buyers with a pack 
 of helpful information about their new home. Our intention is that the home information pack will bring that information in line as far as possible with information available to buyers of existing homes. I accept that commissioning a home condition report on a home that does not exist, or is only half-built, is unnecessary and that is not what we propose. Clause 133(9)(c) provides the power for the Secretary of State to address that in regulation.

John Hayes: Will the Minister give way?

Keith Hill: I am coming to issues relating to new homes, which have been the subject of most of our debates. I apologise if distractions and overviews have strained the patience of the Committee, but I hope that what I have said so far has not been unhelpful.
 I shall say a few words about new homes and our approach to them. I draw the Committee's attention to clause 133, which contains provisions relating to the contents of the home information packs. It gives the Secretary of State the power to prescribe the documents to be included in the pack, as well as the contents of the documents themselves. Clause 134 contains provisions relating to home condition reports. 
 We want to prescribe the detailed contents of the pack in secondary legislation rather than in the Bill, which will allow time for detailed components to be drawn up in consultation with consumer and professional stakeholder representatives. It also provides important flexibility to make changes quickly, if changes in the housing market make some items redundant or if new sources and important information come to light. Clause 133(5) refers to the sort of information that will go into the pack. 
 Amendment No. 313, spoken to so ably by my hon. Friend the Member for Stafford, would add three new subsections, which relate to the information in the pack. The effect of proposed new subsection (5A) would be to ensure that information about the physical condition of the property and its energy efficiency would not be considered as relevant information for inclusion in the home information pack for purchasers of brand new homes, where the home is registered with a warranty provider.

Edward Davey: Will the Minister give way on that point?

Keith Hill: I will give way on that point, although I was trying to deal with amendment No. 313.

Edward Davey: I wanted to intervene earlier, but I failed to catch the Minister's eye. I am surprised by what he is saying, because I understood that, under article 7 of the energy performance directive, an energy performance certificate was required even on a newly built property.

Keith Hill: I intend to say a lot about energy certificates in relation to new properties, so the hon. Gentleman should bear with me.
 I return to amendment No. 313. Proposed new subsection (5B) would enable information on the condition and energy efficiency of the property to be provided by the warranty provider where a new home is resold within the 10-year warranty period, as long as 
 two conditions are met. The first condition is that the person providing the information is the person qualified to carry out home condition report inspections under an approved certification scheme. The second condition is that the warranty provided is part of a certification scheme that has been approved by the Secretary of State. I shall say something about both of those in due course. Proposed new subsection (5C) would define in the Bill the warranty provider as the NHBC or any other body certified by the appropriate authority. 
 Before I deal with those proposed new subsections in greater detail, I fully accept the principle behind amendment No. 313, tabled by my hon. Friend the Member for Stafford, with regard to the relationship between warranties and home condition reports on first-time sales. He and my hon. Friend the Member for Sheffield, Attercliffe raised the issue of the seller having the option to get the warranty provider to carry out the home condition report. That is fine as long as the person is licensed under a certification scheme approved by the Secretary of State and is a fully qualified home inspector. 
 My Department has discussed with the NHBC the application of the home information pack to sales of new homes where a good designated warranty is in place. The NHBC has some reservations about that, which my hon. Friend's amendments reflect, although they were very skilfully drawn up by him. The ODPM consultation paper on the contents of the home information pack proposes that if a physically complete new home being offered for sale were registered under a warranty scheme designated by the Secretary of State, the seller—usually the developer—would be exempt from providing a home condition report in the pack. I shall explain why in a moment. The Committee has been provided with a copy of the consultation paper and the report on the outcome of the consultation. 
 Let me say a few words about the results of the consultation. The 17 respondents who commented had mixed views on whether a home condition report should be provided to potential buyers on practical completion of a property. Some thought that to create a level playing field a HCR should be included in a pack, whereas others thought that if the property were covered by a designated warranty scheme there would be no need for a HCR. The House Builders Federation and the NHBC additionally suggested that where the period of the warranty cover has not expired sellers of second-hand homes should have the choice of either a HCR or an update on their warranty. We must consider further all those views. I promise that we will do so in consultation with stakeholders. However, the Committee will appreciate that the home condition report is an important part of the pack for second-hand homes. There is a danger that any attempt to substitute it for some alternative provision could deprive consumers of the level of comfort or information that they need to help them make important decisions when buying and selling their home. 
 My hon. Friend the Member for Sheffield, Attercliffe vividly illustrated some of the problems that could arise in extensions, or other building works, that could leave the property in a different state at the point of second sale from its original condition. The home condition report is a statement that is aimed at giving buyers good information about the condition of the property they wish to purchase. That is less of a necessity for a brand-new home if there is a warranty agreement in place, because that will require the builder to put right anything defined as a defect that comes to light in the first two years and provide insurance for defined sorts of damage arising in years 3 to 10.

John Hayes: Will the HCR be covered by similar insurance?

Keith Hill: Oh yes, the Committee will want to deal with these matters, but we are clear that indemnity insurance is essential if the system is to have any validity and credibility. We are confident that that is achievable and are working with the industry to secure it.
 Owing to the passage of time, lack of upkeep by the previous owners, or the possibility of modifications that may not be covered or may invalidate the warranty, it is more important that the prospective buyer should have an objective statement of condition for second-hand homes. However, our minds are not closed on this issue and my officials will continue to work with the NHBC and other interested parties to discuss issues related to new homes. 
 My hon. Friend the Member for Sheffield, Attercliffe asked whether the seller could go to another provider for a survey, because a survey is different from a warranty. On the issue of recourse in the event of a survey on resale that identifies defects, my hon. Friend asked where redress is to be sought. In those circumstances it would be possible to claim on the warranty where there is no need to prove negligence. In addition, if there has been a negligent survey that has caused them loss, it might be possible in those circumstances to achieve redress.

Clive Betts: On that point, I understand that the Minister is saying there might be redress against the warranty where there has been no negligence, but there would have to be negligence to have redress against a survey that proved to be faulty. However, where there was a fault on the survey—also an issue that could be dealt with under the warranty—what does the buyer of the property do? Where do they go? Is there not a potential conflict when they could have redress both against the surveyor who had been negligent and against the warranty? Is it possible that those two organisations might get involved in a court case that could affect the legal rights of the purchaser?

Keith Hill: My hon. Friend is right to seek greater precision. The answer in those circumstances is to go to the warranty, which is where the key responsibility lies.

John Hayes: Will the Minister give way on that point?

Keith Hill: On that specific point? Yes.

John Hayes: The Minister has just told us, in answer to a very incisive intervention, that they would rely on the warranty. So what on earth is the point of having this survey? If the warranty is their legal protection for defect, what is the point of having a survey that they will not rely on in the event of a dispute or a problem? In that response, the Minister undermined his whole case. He should now say that the duplication he is implying is entirely unnecessary and wasteful.

Keith Hill: Quite simply, the fact of having a survey does not invalidate the warranty. Let me now deal with the issue of the energy efficiency certificate raised by the hon. Member for Kingston and Surbiton, and we will come back to these other issues in due course.
 We envisage that an energy efficiency certificate will normally be included in the home condition report, so a free-standing energy efficiency certificate will need to be provided in any instance when a home condition report is not included in a pack. Newly built homes are required by building regulations to meet good standards of energy efficiency but, even so, cost-effective improvement might still be possible. In addition, European Union directive 2002/91/EC on energy performance of buildings requires member states to ensure that the owner makes an energy efficiency certificate available to prospective buyers when a building is offered for sale, together with recommendations drawn up by an independent expert on cost-effective improvements of the energy performance of the property. This Bill seems the logical place to provide for that duty. 
 I encourage house builders to register all homes being built for sale under good housing warranty schemes; however, I hope the Committee will agree that it would be inappropriate to name any particular warranty provider in the Bill. We intend to consult separately about designated housing warranty schemes, although I am prepared to say a little more about that in response to questions raised by the hon. Member for Poole (Mr. Syms).

Robert Syms: To return to the point raised by the hon. Member for Sheffield, Attercliffe, the NHBC has a warranty scheme that lasts up to 10 years. It has balances of £1 billion. In order to get redress, once a certificate has been issued, it will do the work without court action. Will the Minister confirm that a home condition report would be accompanied by some sort of insurance so that people would have redress if it were wrong, or if there were a problem with the home? Would that have to be actioned through the courts? Someone's redress taking place in the courts is different from its being a matter of course when a certificate is granted.

Keith Hill: The Bill sets out the requirement for proper insurance in the situation, and the normal processes of claims and liabilities with regard to insurance would prevail. We do not anticipate a separate structure or system in that regard. It is essential that there should be redress for the key players in the process if there are errors at any point in the provision of information in a home information pack that lead to errors on the part of the purchaser.
 We expect the normal arrangements for insurance claims and redress to prevail. For the sake of further clarification, I make the point that it is important to remember that those home condition reports simply provide information, whereas the warranty is the device for easy redress.
 I turn to the amendments tabled in the name of the hon. Member for South Holland and The Deepings. Amendment No. 420 would add a new subsection to clause 134. Proposed new subsection (8)(a) has a similar intention to proposed new subsection (5A) in amendment No. 313 tabled by my hon. Friend the Member for Stafford. It would exempt a responsible person from providing a home condition report on new home sales. New subsection (8)(b) has a similar purpose to new subsection (5B), but rather than enabling an alternative to an home condition report if the property is resold while the warranty cover remains in place, it would remove the duty to provide a report. Subsection (8)(c) provides that a home condition report is not needed when the ownership of new homes is transferred from a developer to another company prior to marketing, where the company assuming ownership is registered with a designated warranty provider. 
 That view is also proposed in the ODPM consultation on the contents of the home information pack—to which I referred earlier—and 16 respondents commented specifically on that suggestion. The majority were in favour of the proposal. I do not feel that the matter should be prescribed in the Bill, because it can be better dealt with in regulations. I assure the Committee that my officials will, as ever, continue to work closely with interested parties to discuss issues relating to new homes. 
 I shall now respond to the intervention made by the hon. Member for Poole, who invited me to put on record our intentions with regard to warranty schemes. For the benefit of the Committee and the industry, I shall take the opportunity to set out our thinking with regard to the designation of warranty schemes. 
 In our view, an effective housing warranty scheme will involve inspections at the construction stage with a view to preventing or correcting defects before completion. An effective warranty scheme will also provide a good measure of redress for the home owner if defects come to light after completion. It should provide for the builder to rectify defined sorts of defects, including quite minor ones, for an initial period, and should then provide no-fault insurance cover for a further period against significant damage arising from defects in the original construction. 
 The designation of any housing warranty scheme by the Secretary of State would be on the basis of a scrutiny of the operational effectiveness of the scheme and the extent of the cover provided. We intend to consult separately on the designation criteria for designated housing warranty schemes. We envisage that the criteria would have regard to the process for vetting builders seeking admission to registers and for monitoring builders on the registers, the technical 
 standards laid down by the schemes, builders' undertakings in relation to compliance with the scheme standards, warranty scheme operators' arrangements for checking plans and carrying out site inspections, the arrangements under schemes for resolving disputes between owners and builders over what remedial work is needed to bring a home into compliance, the terms of the insurance cover underpinning the builder's obligations, and, finally, the terms of the insurance under which the owner can claim if damage due to non-compliance with scheme standards comes to light following the end of the builder's warranty period. 
 I hope that the Committee will forgive me for speaking at some length in response to issues raised in this debate. I hope that, in the light of the comprehensive information that I have supplied to the Committee, hon. Members will agree not to press their amendment.

Robert Syms: I thank the Minister for putting that on the record. I presume from what he said that, apart from the NHBC, there are three major players already in the warranty market, and that he will not try to redesign those organisations, but will certify them, because they are doing a good job at the moment. I presume that if somebody else wanted to enter the market at some point, as one might hope, they would have to meet the standards that are currently being met. I hope that what the Minister was reading was not a description of a whole new set of regulations, controls and burdens that would be placed on the industry. I hope that he will say that if the organisations have good practice, that is great and they can get on with the job.

Keith Hill: I am grateful to the hon. Gentleman for giving me the opportunity to clarify that we are not looking at new burdens on the industry—on the contrary. We envisage that existing organisations will play a central role in the scheme. We will expect new organisations entering the scheme to comply with the criteria that I set out, and also to match up to the excellent standards already in place.
Several hon. Members rose—

Derek Conway: Order. Before I call the next hon. Member, I should make it clear that this is an important part of an important Bill and therefore I allowed the Minister considerable leeway in order to set the tone for the part and to help the Committee in its consideration. However, we must stick to the order of consideration for amendments and clauses. I hope that colleagues will not take the Minister's comments as a reason to broaden the debate to the whole part of the Bill as we deal with this group of amendments. The Minister's words will not prevent clause stand part debates, which will cover the wider principles. I want us to stick reasonably firmly to the amendments as they are grouped, and the subject headings. If we do not, on a complicated part, we shall be all over the place, and no one would want that.

Sydney Chapman: On a point of order, Mr. Conway. The Minister has been extremely helpful in giving an outline of the Government's approach not only to this clause, but to part 5. Do I
 understand that, exceptionally, you might grant us a debate on part 5 stand part, as well as a stand part debate on each clause? If not—I suspect that you will decline my invitation—can we speak fully about the whole of part 5 in a stand part debate on a particular clause, if necessary?

Derek Conway: The Committee will not have a stand part debate on part 5 because that is not a motion that is put to the Committee. The Committee will resolve its opinion on the Bill clause by clause. However, where the clauses themselves are broad and affect all aspects of part 5, I or my fellow Chairman will allow the Committee to cut across clauses where they relate to other clauses. The object is not to try to restrict the Committee in any way, but to ensure that we take things in a proper and ordered manner. We will seek to be as helpful as we can to the Committee.

Andrew Selous: On a point of order, Mr. Conway, would the debate that you alluded to happen under the amendments relating to clause 127—the central clause of this part of the Bill? Could you tell us when that general debate might take place?

Derek Conway: I think that the hon. Gentleman has picked up on a clause where he will be able to contribute on a wide-ranging matter. On the whole, the Chair tends not to restrict Members from going backwards and forwards. Only the knife will restrict that.

David Kidney: Mine is not the lead amendment in this group, and I simply wish to express my satisfaction with the Minister's explanation, answers and assurances.

Brian Iddon: I wish to raise a new point, Mr. Conway, to ensure that innovation in the new house building market is not ruled out. I give an example from my own local authority, many years ago, when we tried to help people to get into new house building by selling shells that were wind and weather-tight and left it to the purchaser to completely finish all the fittings of the interior of the house. That included plastering—or dry lining—electrical wiring, plumbing and all the usual fittings of the bathroom and kitchen. I want to ensure that we do not rule out innovation in the new house building market, whereby local authorities or housing associations can sell properties that are not complete.

Edward Davey: We have had both an excellent and frustrating debate today. Members from all parts have made some exceedingly good contributions. If you cast your mind back to the beginning of our proceedings, Mr. Conway, you will remember that I introduced my amendments briefly and succinctly. I did not expect such a long debate, although it has been an important one. I should like to tell the Committee—I am sure that hon. Members will be very happy to hear this news—that duties on the Floor of the House this afternoon will prevent me from being involved in the Committee's debate. I very much regret that, particularly because of the quality of the debate. However, I want to focus on my frustrations.

Chris Ruane: Ooh!

Edward Davey: May I reword that? I want to focus on my frustrations about today's debate, Mr. Conway.
 In a long, generally helpful and constructive answer, the Minister told the Committee—in his open-minded, engaging and endearing way—that the Government are prepared to look at all the options. The problem is that although the Government first published a consultation paper on this issue in 1998, and introduced the Homes Bill in the last Parliament, and the legislation has gone through a draft legislative process, and now we are being asked to give our consent to primary legislation, we were still told in the very first debate that the Government have not yet worked out which properties will be covered by the legislation. One would have thought that they might have got that right by now—five years on—but they have not. That shows the complication of producing legislation such as this; there is massive regulation where it is not needed. After five-plus years the Government have still not got the details right. In a commendably open-minded yet frustrating way, the Minister is not able to give us the final response of the Government on those key issues. I find that very frustrating. 
 I know that the Minister—who is very popular with all parties in the House—has not been in his post for the full five-plus years during which the Government have been thinking about this, but unfortunately, that is not a satisfactory answer to the Committee. Because I will not be present later this afternoon, I will speak briefly about the principle—in two lines. The Minister could get out of the hole that he has dug himself into—or that his predecessors dug and pushed him into—by saying, when we discuss clause 127, that the whole of part 5 could be voluntary. Take away the element of compulsion and a lot of these problems—the problems of detail and of substance—go away. He simply needs to say that. 
 The Labour party's 1997 and 2001 manifestos did not say that the home information pack scheme would be compulsory—they said that the scheme would be introduced. There would be support on both sides for a voluntary scheme, set down in legislation that explained what would be in the pack. That would get agreement, and we would let the market take forward such a home information pack described in the regulations. We could get rid of all these problems and we could excuse the Minister's lack of answers. It is the Committee's job to get answers. I intervened on the Minister earlier, having been rather frustrated by the fact that, while he was being open-minded, he could not give us a timetable. This is important.

Keith Hill: I have given a timetable.

Edward Davey: The Minister has given a timetable for the introduction of the whole scheme at the beginning of 2007, but that is irrelevant to the Committee. It is being asked to give its consent to the legislation. Which houses will be involved is a pretty important principle. It is not a minor detail; it is absolutely key. I want the Minister to tell us whether we will have answers to these questions by Report. Will we have to wait until the Bill goes to the other House? When will we know the Government's answers?

Sally Keeble: On the point of compulsion, my reading is—correct me if I am wrong—that clause 127 imposes a duty. However, that duty is only to comply with regulations made under clause 133, which is wide and permissive. So it is saying that one has to have a home information pack that complies with regulations, but it does not say what type of regulations will have to be made. It would help to know whether my understanding is correct, because this is an important point for the public.

Edward Davey: I do not know whether the hon. Lady is coming over to thinking that this should not be compulsory. If she is, that is very welcome. My understanding of clause 127 is that it was the point at which a duty—which would have a compulsory element—would be introduced. If, in reply to these remarks, the Minister says, ''No, the regulations will be permissive and there will be no compulsion after all'', we can all relax.

Chris Ruane: The Consumers Association's briefing says:
''The idea of making the pack voluntary would not deliver the much needed cultural change in the way in which we buy and sell homes.''
 Last month it surveyed consumers on the issue of HIPs, and a resounding 82 per cent. said that they would be very useful.

Edward Davey: We could all quote a range of external organisations at length—the Consumers Association, the National Association of Estate Agents, the Law Society, the Royal Institution of Chartered Surveyors. A whole group of people—and other independent experts—have commented on this. My only complaint to the Consumers Association is that it is going against the interests of consumers. I think that it has got its arguments utterly wrong. That is my concern about this legislation.
 I do not want to stray too wide, because I want to return to the amendments. I take the Minister's point that the purpose behind amendment No. 334—and the way that I introduced it with respect to derelict properties—may be a smaller issue. However, on the rest of the debate one can choose one's solution—whether that is our amendment No. 335, amendment No. 313 tabled by the hon. Member for Stafford, or amendment No. 420 tabled by the hon. Member for South Holland and The Deepings. They are different approaches to a crucial issue: whether new properties will require home information packs. The Minister was very discursive in his response to this. I was trying to get a nuance of where his thinking was going, but he was so expansive that I was left without any indication as to where the final decision will be made. Will it completely keep new homes within the home information pack regulation? It was not at all clear. Perhaps it is my fault. Maybe I was not listening carefully—it was a rather long speech and I cannot say that I was concentrating on every moment of it—but I think it is vital that the Minister gives a clear indication of the Government's intention.

John Hayes: I have to say that I very largely agree with the comments made by the hon. Member for
 Kingston and Surbiton, although I am neither frustrated like him, nor easily satisfied, like the hon. Member for Stafford. The Minister may have spoken at great length, but he did not speak with much clarity. He has opened a Pandora's box this morning, certainly in terms of legal liability. He says that the warranty is what people will need to rely on, yet he is unclear about whether they will also need home information packs. He says that it will be important that the warranty is properly controlled. He is right—our amendment says that, as does that of the hon. Member for Stafford. We do not deny that there should be proper checks and balances on warranties and who provides them, but that is not an argument for the Government's proposals on home information packs. He says that the Government are still listening, are prepared to take advice and are open to all comers and all suggestions. Yet they have been taking advice and consulting for a considerable time.
 The Minister says that this will all be dealt with by secondary legislation, by regulation, and then points with a degree of pride to clause 132, as though this was an answer to all the queries today. He then argues that there may be power for the Government to accept the inclusion of certain properties, but does not give us any indication as to which properties these may be. 
 There is an extraordinary lack of clarity in what we have heard this morning from the Minister. I freely acknowledge that the Minister is a wise and generous man, who genuinely listens to the views of all Members. However, when we come to decide what is in the Bill we, as members of this Committee and as Members of this House, deserve a little more certainty than we have been provided with this morning. That is particularly true in relation to the amendments from the hon. Members for Stafford and for Kingston and Surbiton, and in relation to my own amendment. 
 It is no good the hon. Member for Vale of Clwyd (Chris Ruane) saying that people all liked the pack in the trial.

Chris Ruane: I was scratching my arm.

John Hayes: The hon. Gentleman sits there scratching his arm, but it is no good him maintaining that people liked the pack in the trial. They did not have to pay for it in the trial, and people like things when they are free, but not when they are told that they have to pay £600, £700 or £1,000 for them.

Geraldine Smith: Does the hon. Gentleman not accept that people selling a home are quite often buying another home, so they would save on wasted survey fees and the process would be much quicker? I think that this will be welcomed by both sellers and buyers.

John Hayes: I am delighted at the hon. Lady's intervention. She is telling us that the costs will be passed down the line, and so there will be a trickle effect. As people sell a house, if they know they are required to buy one of these surveys they will add a little to their price, then as the next person in the chain is in the same situation they will add a little to their price, too. If the house is of low value—at the bottom end of the market—and these packs end up costing not
 £600 but £1,000, they will be a substantial additional financial burden for people in that chain. I am not sure that the hon. Lady would want to impose that sort of burden on some of the most hard-up and desperate young families in her constituency, who are trying to get into the housing market for the first time—or is that what she is telling us she wants? I doubt it. Knowing her reputation as a diligent Member of the House, I would find it very surprising if she did.

Geraldine Smith: The hon. Gentleman must accept that there will be savings on wasted survey fees for many people. I have had the same thing happen myself. I wanted to buy a house and got into a lengthy process, and then found out at a very late stage that there were serious problems with the house. That happens to many of my constituents. The measures will speed up the process and prevent those problems, and it will be much welcomed by many of my constituents.

John Hayes: As a result of my oration—I was going to say my Periclean oration, but I do not want to over-egg the pudding—we have found the last remaining enthusiast for the proposal: the hon. Lady. She is an unabashed enthusiast for it.
 The hon. Lady tells us that this will speed up the system, but imagine the case of a new home covered by the amendments. The buyer has had to get a mortgage and a survey at the lender's stipulation. The buyer has a warranty and the house has been indemnified as a result. He is comfortable with the relationship that he has formed with the house-builder. Then he is told by an interfering Minister—a gentleman from St. Reatham—that he must also have an additional report, perhaps conducted almost simultaneously with that warranty provision, and an inspection from the company that is to lend him the money to buy the house. Will that be welcomed by anyone? Will it speed up the process? The buyer will have more inspectors drumming around the house for the first few weeks than he can shake a stick at. It is nonsense to suggest that the proposed system is more efficient. 
 The Minister has made a thoroughly unconvincing case in a typically charming way. He is like a good batsman on a dodgy wicket or like a man with a glasshouse trying to grow beautiful flowers, but with no sun to enable him to do so. Only you will understand the reason for that contorted metaphor, Mr. Conway. He is a good Minister dealing with a bad part of a Bill in which there are parts that we welcome. He knows that this is the weakest part of the Bill and I am sure that he is somewhat embarrassed by it. 
 I hope that my hon. Friends, Liberal Democrat Members, Members such as the hon. Member for Kidney—[Laughter.] I mean the hon. Member for Stafford—the hon. Member for Bolton, South-East and others who have raised legitimate concerns about the clause will join me when I press my amendment to a Division. 
 At the beginning of the debate on this part of the Bill, we highlighted the profound problems with a scheme from a Government that have not sorted out 
 their view on the matter. They know that their manifesto commitment does not wash with most people in the industry and the vast majority of those who have looked at the provisions closely. In fact, I do not think that it washes, in honesty, with most Members of the House or the Committee. We need to test the issue by way of a vote, and we will need to return to the subject as the Bill proceeds through the House.

Keith Hill: Well, we have been treated to some flights of rhetoric in these concluding moments of our considerations on the amendments. The Committee will forgive me if I do not follow those flights of fancy in which Members of the Opposition have engaged.
 I feel that I have paid the penalty for my efforts to provide maximum information to the Committee, in terms of the condemnations that I have received. I have sought to lay all openly on the line—and it has clearly sent the hon. Member for Kingston and Surbiton to sleep, so I am damned if I do and damned if I do not. I do not know how many more times I have to say, on the question of new homes, that warranties will suffice and that we will require home condition reports on second sales. I have said it repeatedly. I hope that it has now registered with the hon. Gentleman. He has a fixation with derelict properties, but perhaps I can drag him away from that fixation and explain to him in terms the definitions and the applications of properties to which this part of the Bill will apply. 
 The clause sets out the meaning of residential property for these purposes. If the hon. Gentleman will do me the courtesy on this occasion of not falling asleep and not discussing the subject of derelict property with that rare bird, the hon. Member for Teignbridge (Richard Younger-Ross), I shall remind him that residential property means a single dwelling together with any ancillary land—for example, a garden—that is or is meant to be occupied as a separate dwelling. That definition includes homes that are still under construction or not yet built. The duties described elsewhere in this part of the Bill would therefore apply to homes being sold off plan. 
 I have said that I am open-minded on the subject of derelict properties, but let me make it entirely clear what properties the Bill excludes.

John Hayes: Will the Minister give way?

Keith Hill: No, I will not. I am enjoying this. I ask the hon. Gentleman to pay attention for one moment.
 We are talking about residential properties. Therefore, excluded from the Bill are non-residential properties, mixed commercial and industrial or residential property, a residential property that does not qualify as a dwelling house, such as a mobile home—I hope that that will not set off further inquiries, but we will possibly have an opportunity to discuss that later—probably being sold with sitting tenants and not, therefore, available for owner occupation, portfolios of properties in circumstances where no offer for a single dwelling would be accepted and leases of less than 21 years. It could not be clearer.

Edward Davey: The Minister is being very helpful to the Committee. I take it that if a commercial property is being sold to someone who wants to convert it into a residential property, a home information pack is not needed.

Keith Hill: I can give the hon. Gentleman that assurance. We must always remember that the Bill is about consumer protection: it is about the house purchase and selling process.
 In that connection—

Sally Keeble: Can I ask the Minister one question?

Keith Hill: Let me complete my sentence and then I shall give way. Finally, let me deal with the issue of whether it should be a voluntary or a compulsory scheme.

Sally Keeble: My question relates to sitting tenants and my hon. Friend may want to send me a note on this. He referred to a sitting tenant. Does he mean a sitting tenant who occupies all the property, so there is no issue about land, or someone having a tenant in one room, which he uses as a dodge, particularly in low-value areas, to avoid having a home information pack?

Keith Hill: I need to consider that question. The issue of using sitting tenants in low-value areas to avoid a home information pack is something that I need to think about. If my hon. Friend will forgive me, I shall not even write to her. Issues relating to sitting tenants arise later in our considerations.

David Kidney: Clause 131.

Keith Hill: My guru tells me that these issues arise in clause 131. With my hon. Friend's permission, we shall deal with those issues at that point.
 Let me finally, in the dying moments of this debate, deal with the question whetherthe scheme should be voluntary. If it were left as a voluntary scheme, it simply would not happen. That is the reality.

Chris Ruane: Another argument for compulsion is that the home owner who is moving house and who believes in HIPs, and so would have had one prepared and paid for it, may take a double hit. He will pay for the HIP on the property that he is selling, but if the person from whom he is buying a property does not believe in HIPs, he will have to pay for further surveys on that property too. The person who believes HIPs will thus be doubly hit, whereas those who do not will have to pay nothing.

Keith Hill: I need say nothing further, as my hon. Friend makes the point that I was about to make. We must remember that the measure is aimed at chains of purchasers and sellers. If it is a voluntary scheme, there will always be someone who wants a free ride, which will negate the entire purpose of facilitating house purchases in a chain. My hon. Friend agrees with me; I agree with my hon. Friend.

Chris Ruane: We agree with each other.

Keith Hill: We agree with each other. I rest my case.

John Hayes: The Minister became untypically heated in his final remarks. I am disappointed that the hon. Member for Stafford has chosen not to press his
 amendment, which in some ways contains a more perfect form of words than my own. Had he pressed it to the vote, Conservative Members would have been encouraged to support him. I hope that he considers our amendment in the same spirit.

David Kidney: I seem to be going around the track for the third time, which I did not intend to do. I am not pressing my amendment, because my right hon. Friend the Minister has given a categorical assurance that the regulations will exempt first-time sellers of new homes from having to produce a home condition report. That is fine. In addition, my right hon. Friend has not excluded the possibility of organisations such as the NHBC offering an alternative way of providing the report on properties sold within the 10 years of the warranty. That is why I will not press my amendment. I would vote against the amendment No. 420, because the drafting is so sloppy in paragraphs (b) and (c), which relate to sales subsequent to the first one.

John Hayes: I am very surprised at the hon. Gentleman, as I had always thought that he was a kind man. His accusation regarding my amendment has cut me to the quick.
 Although the hon. Gentleman is right to say that the Minister has gone some way to satisfy the Committee in respect of new homes, about which there was considerable doubt and we will seek even greater clarity, the right hon. Gentleman has not clarified the issue of the early resale of houses covered by warranty. The Minister has said that he will be agreeable to supporting the current warranty schemes, as we propose, and ensuring that any new warranty schemes comply with proper standards to ensure effectively that, if the Bill becomes law and home information packs are introduced, there is a proper marriage between good-quality warranties and the pack. However, although he has freely acknowledged that the warranty is the principal legal device through which one seeks redress, he has not said that houses that are covered by warranty will be exempted from the information pack requirement. He may have said that he will think about that, but he has given us no guarantee. 
 It is unacceptable to leave that door open and to say to people with warranties who may sell their house within a year, or two, or three of buying it, that they must still have home information packs with home condition reports.

Clive Betts: Is the hon. Gentleman actually going to press an amendment that could lead to a situation in which someone sold a home built nine years and nine months previously without a report, so that the purchaser had the benefit of a warranty lasting no more than a few weeks, but not a new, updated survey to cover it?

John Hayes: Again I say to the hon. Gentleman that that is true of any scheme. It is certainly true of the scheme that the Minister envisages. There will always be cases on the margin in which any warranty, guarantee, or other scheme is coming to the end of its life. That will certainly apply to the home information packs, which will have a limited life. Someone who buys or sells at the end of that life
 period may be caught on the margin. However, that is not a substantive argument against my amendment.
 The most straightforward way to deal with that is to point out that in respect of houses covered by warranty, to which we will return later, only 20 per cent. of people currently have surveys, and there is no guarantee that that will not continue. Perhaps all the people who want an additional survey will buy one anyway. The home information pack might be seen as a baseline product against which people choose to seek further assurances. It is sensible that the Government rest on the warranties, where people have them, and work with the industry to ensure that property is certificated and that there are the checks and balances necessary to guarantee consumer the protection that all hon. Members want. I encourage all Committee members to support amendment No. 420 to improve the Bill and to get the Minister out of the deep hole that he has dug and plunged into.

Edward Davey: I am sure, Mr. Conway, that you will be delighted to know that I am slightly less frustrated than I was before, particularly after the Minister's response to amendment No. 334. However, I intend to press amendment No. 335, because it would exclude not only home condition reports, but home information packs, on new properties.
 We are totally against this measure. We would prefer to have sections of properties on the market taken out of this onerous legislation, but the big debate on that will come later. The Minister's response on the voluntary-compulsory issue is not good enough. Given that the Government have taken so long to get to this point, and given the inadequacies of the pilots, it would surely be wise to proceed on a voluntary basis for the first few years. The Government could give themselves regulatory powers in this Bill to make the packs compulsory in due course if a voluntary scheme did not work out properly. 
 We know that the Minister has held discussions with the industry about a regional roll-out, and we know about the complications around that. Surely, it would be better to see whether the measure works on a 
 voluntary basis for the first two or three years, after which time the Government could come back to it if it were a real failure and make it compulsory by regulation.

Derek Conway: Let me explain what I am about to do, so that everyone understands what they are doing. I shall ask the Committee whether it wishes the hon. Gentleman to withdraw amendment No. 334, then I will ask him to move amendment No. 335 formally and the Committee will take a view. Amendment No. 420, tabled by the hon. Member for South Holland and The Deepings, will be taken later on—probably on Tuesday morning, at the point at which it is reached in the Bill, when it will be voted on formally. So now we all know what we are doing.

Edward Davey: I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn. 
 Amendment proposed: No. 335, in 
clause 120, page 84, line 16, leave out 
 '(and includes one that is being or is to be constructed)'.—[Mr. Edward Davey.]
 Question put, That the amendment be made:—
The Committee divided: Ayes 7, Noes 12.

Question accordingly negatived. 
 It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order. 
 Adjourned till this day at half-past Two o'clock.